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European Commission calls on Spain to amend tax form 720

Further to the infringement procedure pursuing legal actions against Member States failing to comply with EU law, the European Commission sent last 15th of February a reasoned opinion to Spain requesting to change the provisions of Tax Form 720 used to report on certain assets held abroad, considering that the fines charged for failure to comply are disproportionate, and consequently, such provisions are discriminatory and in conflict with the freedom of movement in the EU. The Commission may refer the Spanish authorities to the Court of Justice of the EU if a reply is not provided within two months.

Spanish tax authorities have already expressed their intention to defend said provisions, even through the Courts, as we can read in the press.

The decision of the European Commission may encourage those who did not report on time and are now under pressure because of the automatic exchange of information in respect to the Common Reporting Standard, to take a decision and amend the situation voluntarily prior to be requested or investigated.